DEPARTMENT OF DEFENSE Defense Commissary Agency Fort Lee, VA DIRECTIVE. Internal Audit Activities

Transcription

1 DEPARTMENT OF DEFENSE Defense Commissary Agency Fort Lee, VA DIRECTIVE Internal Audit Activities DeCAD 90-5 Internal Review OPR: DeCA/CCIA References: See Enclosure 1 1. PURPOSE. This Directive: a. Replaces Defense Commissary Agency Directive (DeCAD) 90-5, August 10, 2011 (Reference (a)), and re-establishes DeCA Manual (DeCAM) (Reference (b)). b. Establishes policy and authorizes the DeCA Internal Audit (IA) Division, in accordance with (IAW) Department of Defense (DoD) Instruction , Audit Policies, April 27, 2007, (Reference (c)), as a staff function reporting directly to the DeCA Director and Chief Executive Officer (CEO), to conduct audits and follow-up audits of DeCA activities at all levels. c. Defines standards and responsibilities for the IA Division according to the DoD Office of Inspector General Audit Handbook, Sixth Edition, updated September 20, 2010, (Reference (d)). 2. APPLICABILITY. This Directive applies to all DeCA activities. 3. POLICY. It is DeCA policy that: a. Adequate audit coverage of all DeCA organizations, programs, activities, and functions shall be provided as an integral part of the DeCA management system. b. Independent evaluations of DeCA programs and operations shall be conducted IAW reference (b) and DoD Directive (DoDD) , Follow-up on General Accounting Office, DoD Inspector General, and Internal Audit Reports, June 3, 2004, (Reference (e)) to determine whether: (1) Management control systems are adequate.

2 (2) Information is reliable and valid. (3) Applicable laws, regulations, and policies are followed. (4) Resources are safeguarded and managed economically and efficiently. (5) Desired program results are achieved. (6) Operations are effective and efficient. c. The IA Division shall ensure it meets requirements for: (1) Independence. In all matters related to audit work, both the IA Division and individual auditors should be free in fact and appearance from personal, external, and organizational impairments to independence, as required by GAO G, Government Auditing Standards, (Yellow Book), December 2011 Revision, (Reference (f ). (2) Quality Control. The IA Division staff should have a peer review conducted IAW Reference (f) by reviewers independent of the organization being reviewed. The peer review should determine whether the audit organization s internal quality control system is in place and operating effectively. d. The IA Division staff is authorized full and unrestricted access to all personnel, facilities, records, reports, databases, documents, or other DeCA and DoD information or material that is necessary to accomplish the audit objectives and perform their duties IAW Reference (f). Auditors will aggressively follow up on requests for information to ensure audits proceed on a timely basis. e. Indications of fraud or other criminal acts discovered during review or extended audit steps shall be referred to the appropriate investigative organization, IAW Reference (f ). f. Audit support of criminal investigations shall be provided to the extent possible within legal limitations and resource availability. g. Management needs shall be considered in the development of audit plans. When completed, the DeCA Inspector General (IG) shall review the annual audit plan with the DeCA Director. h. Uniform standards and procedures shall be developed and implemented to improve the efficiency and effectiveness of the IA Division. Reference (b) provides guidance on the basic audit procedures consistent with DoDD , Defense Commissary Agency, March 12, 2008, (Reference (g)). 2

3 i. General standards, financial audit standards, and performance audit standards are included in conducting financial and performance audits. The IA Division will comply with all audit standards as stated in Reference (f). (1) General Standards. (a) Apply to all financial and performance audits. (b) Relate to the qualifications of auditors assigned to perform the audit. (c) Relate to the independence of the audit organization and individual auditors. (d) Relate to the exercise of due professional care in conducting the audit and preparing related reports, and the presence of quality controls. (2) Financial Audit Standards. (a) Provide accountability for government programs and services through independent audit reports. (b) Include financial statement audits and financial-related audits. (c) Pertain to audit fieldwork and reporting. (3) Performance Audit Standards. (a) Provide an independent assessment of the performance of a government organization, program, activity, or function. (b) Include economy and efficiency of audited programs. (c) Pertain to audit fieldwork and reporting. (d) Note that auditors may conduct performance audits in financial areas. When this occurs, the performance standards apply to the audit. 4. RESPONSIBILITIES. a. The Director and CEO shall, IAW References (f) and DoD Manual M, DoD Audit Manual, February 13, 2009, Reference (h): (1) Provide guidance and direction through an approved Annual Audit Plan for the Internal Audit Division. (2) Provide management oversight over the Internal Audit Division function. 3

4 (3) Ensure the IA Division is staffed with adequate resources, personnel, and funds. (4) Regularly update DoD and the Board of Directors on the Agency internal and external audit status. b. Senior Executives and Directors within the Agency shall: (1) Submit requests for audits to the IA Division. (2) Assist in the resolution of problems discovered during internal audits. (3) Provide the IA Division with support, upon request, to include suitable workspace. (4) Provide responses to audit report findings and recommendations, IAW References (e) and (f). c. The DeCA IG shall: (1) Serve as the DeCA Director s principal advisor and liaison on all audit matters, to include all external audits conducted by the DoD IG, Government Accounting Office, or any other DoD activity. (2) Serve as part of the DeCA Director s operational control system, providing an internal audit capability within the Agency, determining the nature and cause of problems, and developing recommendations to resolve identified problems. (3) Provide assistance to Agency senior managers by performing audits, special assessments, analyses, follow-up audits, and problem-oriented examinations. (4) Prepare an annual audit plan. Solicit audit proposals from Agency management and audit staff for consideration in developing the annual audit plan. Use the annual audit plan to measure performance; ensuring audit resources are properly used. (5) Request and obtain funding for Government Accountability Office required auditor continuing professional education. d. The Deputy Director, IA Division (Supervisory Auditor) shall: (1) Perform the duties of the first-line supervisor for the auditors, to include: (a) Provide appropriate instructions to subordinates. (b) Ensure approved audit plans are executed properly unless exceptions are authorized. 4

5 (c) Provide work assignments, considering the abilities and experience of subordinates. (2) Perform duties of the DeCA Inspector General, when required. DeCAD 90-5 (3) Ensure audit reports and working papers, prepared by the auditors, comply with References (b), (i), (e), (h), and GAO G, Assessing the Reliability of Computer Processed Data, October 2002, External Version 1(Reference (i)). (4) Develop and maintain a file of auditable entities to ensure audit workload is properly identified and prioritized, and adequate audit coverage is provided to all functional elements. (5) Ensure proper career development of assigned auditor personnel. (6) Ensure each auditor receives professional training to comply with References (b), (f), and (g). e. The Lead Auditor(s) shall: (1) Perform oversight of audit planning, execution, and reporting. (2) Identify, distribute, and balance workload and tasks. (3) Perform the duties of the Deputy Director (Supervisory Auditor), IA Division, when required. 5. This Directive does not contain internal management control provisions that are subject to evaluation, testing, and other requirements of DeCAD 70-2, Internal Control Program, December 17, 2007 (Reference (j)), as specified by the Federal Managers Financial Integrity Act and DoDD , Administrative Control of Appropriations, May 4, 1995, Certified Current as of November 21, 2003, (Reference (k)). 6. RELEASABILITY UNLIMITED. This Directive is approved for public release and is located on DeCA s Internet Web site at Resource Center, DeCA Publications, Directives/Manuals/Handbooks/ Office of Internal Audit. 7. EFFECTIVE DATE. a. This Directive is effective. 5

6 b. Must be reissued, cancelled, or certified current within 5-years of its publication, IAW DoDI , DoD Directives System, (Reference (l)). If not, it will expire effective August 15, 2024 and be removed from the DeCA Issuances Website. Enclosures: 1. References 2. Acronyms Tim C. Ford Chief, Executive Services Division 6

7 ENCLOSURE 1 REFERENCES a. DeCAD 90-5, Internal Audit Activities, August 10, 2011 (hereby cancelled) b. DeCAM , DeCA Audit Manual, c. DoD Instruction , Audit Policies, April 27, 2007 d. DoD Office of Inspector General Audit Handbook, Sixth Edition, updated September 20, 2010 e. DoD Directive , Follow-up on General Accounting Office, DoD Inspector General, and Internal Audit Reports, June 3, 2004 f. GAO G, Government Auditing Standards, (Yellow Book), December 2011 Revision g. DoD Directive , Defense Commissary Agency, March 12, 2008 h. DoD Manual M, DoD Audit Manual, February 13, 2009 i. GAO G, Assessing the Reliability of Computer Processed Data, October 2002, External Version 1 j. DeCAD 70-2, Internal Control Program, December 17, 2007 k. DoD Directive , Administrative Control of Appropriations, May 4, 1995, Certified Current as of November 21, 2003 l. DoD Instruction , DoD Directives Program, June 6, References

8 ENCLOSURE 2 ACRONYMS CEO CCIA DeCA DeCAD DeCAM DoD IA IAW Chief Executive Officer Internal Audit Division Defense Commissary Agency Defense Commissary Agency Directive Defense Commissary Agency Manual Department of Defense Internal Audit Division In Accordance With 8 Acronyms